European wheat fell sharply on Monday, as renewed comments by Turkey about seeking a diplomatic solution to stop war disruption to Black Sea grain shipping drove profit-taking after Friday's contract highs.
December wheat, the most-active contract on the Paris-based Euronext, fell 2.2% to €245 ($284.57) a metric ton at 1630 GMT, retreating from Friday's life-of-contract peak of €252 a ton, which was also a two-year high for a second-month price.
Turkey has prepared a plan for the safe passage of grain via the Black Sea and is in contact with Russia and Ukraine, Foreign Minister Hakan Fidan said on Monday, reiterating Turkey's desire for a truce in the crucial waterway for grain trade.
One futures trader noted there was some profit-taking on Monday, but also that Turkey had been working on a deal "for a while on this but with no luck so far".
Attacks in recent weeks brought grain loadings at Russian and Ukrainian Black Sea ports to a virtual halt, increasing pressure on importers to seek alternatives.
Demand has also been transferred to some European Union countries, including several loadings in France for Egypt, and alternative routes have allowed some volumes to flow from Russia and Ukraine.
Russian grain exporters have rerouted shipments to the Baltic Sea, including ports in the Baltic states, traders and analysts told Reuters on Monday.
Weekly Ukrainian exports of wheat, corn and barley increased by 28% over August 20 to 26, the APK-Inform consultancy said on Sunday.
“Turkey was a big driving force behind the previous Black Sea safe shipping deals as Turkey has a lot to lose if its import flows from Russia and Ukraine are cut or become more expensive,” one German trader said. “If Russian and Ukrainian Black Sea wheat returns to the market in high-volume ocean shipments prices are expected to fall sharply."
(Reuters)
